Steadfast Dept.-Store Chain J.C. Penney Making Plans to Close Stores
March 1, 2017 (STL.News) J.C. Penney seems to be the latest of the once steadfast department-store chains to run into problems. They’re recent announcement to close 140 stores comes not long after news that other chains like Macy’s and Sears were closing stores to shed costs after low sales. The chain has eight locations in the St. Louis metro area.
Macy’s had recently announced plans to cut 100 of its 675 full-line stores. Sears has plans to close 150 stores, including 108 Kmart locations. J.C. Penny’s is now running into the same problems as its competitors such as online competition, numerous fast-fashion retailers like H&M and Forever 21 and discounters such as Marshall’s and T.J. Maxx.
The Plano, Texas-based retailer will also be closing two distribution facilities, in Florida and California. The company reportedly had 1,021 stores as of Jan. 30, 2016, but according to corporate documents, that is down from a high of 1,108 in 2009. The closures will represent about 14 percent of J.C. Penney’s total store portfolio, but less than 5 percent of total annual sales.
Even though the well-known chain was still profitable in 2016, it was the first time since 2010. The company decided to focus on women’s apparel and larger women’s plus sizes last year and they did very well with both of those categories. Even so, they realize the need to make some serious changes.
Penney plans to open 70 more Sephora shops in its stores this year, and ramp up volume in their beauty salons, which made a formidable turnaround in 2016. Store officials say they also plan to add kitchen and laundry major appliance departments to 100 more stores. That concept was introduced last year in 500 stores.
It is still not clear how many jobs will be lost by the closures, but J.C. Penney says it will offer early retirement to 6,000 of its full-time workers. Those eligible for the program will include home office, store and supply chain personnel who meet certain age and service criteria, officials said.
A full list of planned store closings will be released in mid-March after stores are notified. Liquidation sales are expected to take place by the second quarter, and most of the stores are expected to close by the end of July.